After eight years of negotiations and debate, a sweeping new version of the General Agreement on Tariffs and Trade received U.S. approval. The pact is aimed at bolstering world trade by slashing tariffs and subsidies, but opponents continued to worry that GATT would cost some U.S. manufacturing workers their jobs.
Initial results of the North American Free Trade Agreement--the 1993 pact that relaxed trade barriers between the United States, Mexico and Canada--appeared positive for U.S. business. Midwestern farmers sold more corn to Mexico, and heavy-equipment and trucking companies both scored big sales gains and expect more to come.
Americans bought more Mexican products, offsetting a surge in U.S. exports to Mexico and sharply cutting the U.S. trade surplus with the nation. Nonetheless, analysts caution that the final verdict on NAFTA is still years away.
7. Utility Deregulation Looms
State regulators decided to open the electric power market to competition in hopes of lowering Californians' power rates, which are now roughly 50% higher than the U.S. average. But there's a snag: The seemingly simple matter of letting Californians choose from whom they buy their power is proving difficult.
The utilities, consumers and environmentalists have presented different proposals, all of which are being hashed out in public hearings before the state Public Utilities Commission. The PUC's own plan, which began the debate in April, in effect would permit customers to choose their power providers much as they now pick long-distance telephone companies.
The final plan--which companies can offer electricity to which consumers, along with such details as whether low-income assistance and environmental programs can survive a free market--still needs to be worked out.
8. Hollywood Does the Shuffle
A "Dream Team," some nightmares and a blockbuster merger changed the face of Hollywood. Director Steven Spielberg, former Disney studio head Jeffrey Katzenberg and music mogul David Geffen joined forces to create their own entertainment company. Katzenberg's departure from Disney was just one of many hurdles for that firm, which also lost its No. 2 executive, Frank G. Wells, in a helicopter crash. Viacom Inc. joined the ranks of entertainment giants by acquiring Paramount Communications Inc. and then Blockbuster Entertainment Corp.
But past Hollywood mergers came to haunt the Japanese. Sony Corp., admitting failure in its purchase of Columbia Pictures for $5 billion five years ago, took a $2.7-billion write-off on the movie studio, now named Sony Pictures. Matsushita Electric Industrial Co.'s ownership of MCA Inc. also looked rocky after management squabbles erupted between Matsushita and MCA, home of Universal Studios.
9. Nasdaq Comes Under Fire
The Nasdaq stock market, which operates electronically through dealers at brokerage firms, came under multiple investigations by the Justice Department, the Securities and Exchange Commission and other regulators. The focus is on whether dealers have colluded to set prices, quoting customers abnormally large "spreads" between the stocks' "bid" and "asked" prices.
A series of stories by The Times examined allegedly unfair practices in Nasdaq trading that work to the disadvantage of small investors. Nasdaq defended its trading but also proposed new rules that would give small investors more of a chance to trade at prices better than those quoted by the dealers. The market's parent, the National Assn. of Securities Dealers, formed a committee to review Nasdaq operations.
10. Health Care Reform
Or the lack of it. The Clinton Administration's massive and complex attempt at reform fizzled, but industry providers kept buying and selling assets, anticipating that some type of change will be forthcoming.
Mergers swept the health care and biotechnology industries. Columbia/HCA Healthcare Corp. agreed to buy HealthTrust Inc. for $3.5 billion, and National Medical Enterprises struck a deal to buy rival hospital chain American Medical Holdings for $3.3 billion. On a smaller scale in the biotechnology industry, Amgen Inc. in Thousand Oaks agreed to buy Synergen Inc. for $240 million.